You have been hired by a local drainage company to analyze the profitability of drain tile. They have provided you with 160 acres that will be used as the test plot. It is estimated that adding drain tile will increase operating receipts by $125/acre. The cost to purchase and install the drain tile is $850/acre. The investment period is 10 years and the drain tile can be depreciated over 15 years. The salvage value of the drain tile after 10 years would be $50/acre. The marginal tax rate is 25%. You can use a 8.75% pretax, risk-free discount rate, 1.75% inflation rate (all operating receipts, operating expenses, and terminal values are in real dollars), and 3.5% risk premium for this project. The local lender has agreed to provide special financing for these projects. The bank will finance the drain tile over 10 years at 6.875% with annual payments. Analyze this investment. What is the NPV and IRR? Should the farmer invest in the drain tile?